A modern fairytale based on facts

Thun's growing distribution network and mountains of client data presented both a challenge and an opportunity. How could the storied maker of decorative objects and high-quality giftware establish a client-based distribution strategy based on facts?

"The story of Thun is a modern fairy tale," says Luca Dalla Serra, Thun Commercial Director. A fairy tale that starts in 1950, when Counts Lene and Otmar Thun gave life to the Thun Ceramics Factory at Klebenstein Castle in Bolzano, Italy. It was a longtime dream that finally became a reality. The Thuns gave a free, creative reign to establish a tradition of innovation, leading the original ceramics laboratory to become a national leader in decorative objects and high-quality giftware.

Today, with a distribution network of more than 200 points of sale in Italy and across Europe, Thun is the driving force of a physical and virtual community of clients brought together in the Thun Club (approximately 100,000 members) and THUNity (500,000 users profiled).

Thun's growing distribution network and mountains of client data presented both a challenge and an opportunity. How could the organization establish a client-based distribution strategy based on facts?

"The emerging need," explains Dalla Serra, "is that of optimizing the commercial strategy to optimally manage a mixed distribution that revolves substantially around the wholesale and retail channels. From this arose the need to make decisions relating not only to national coverage, and therefore the number of points of sale, but also their location and the type of product best adapted to the client profile, based on certain, reliable analyses."

To meet this need, Thun turned to SAS®.

Thanks to this project, we are now able to identify the zones with the highest potential in Italy and to implement an optimized, balanced distribution strategy between the wholesale and retail channels.

Luca Dalla Serra
Thun Commercial Director

Analyzing potential with geomarketing and data mining

Thun's objective was to apply SAS Business Analytics to assess the potential of its various territories based on current performance at the point of sale and use this information to plan its distribution strategy. After identifying potential areas in Italy (based on economic indicators) and consumer clusters (based on socio-demographic parameters), Thun constructed a geomarketing model that calculates the potential index for specific areas and populations.

In addition, analysis of the information generated by points of sale (including structure, location, income statement, marketing activities, competitors, etc.) allows the company to identify commercial performance drivers using a logistic regression model.

SAS partner VALUELAB made a decisive contribution to the success of the project, helping Thun with its analysis of consumers and national distribution. Thun considered both socio-demographic data and purchasing behavior to segment the client base. To analyze its presence on the national market, Thun used GeoIntelligence software and SAS Analytics to define market potential, map sales throughout the country, identify areas in which a presence should be established, and acquire important information to support the decisions of its agent network, integrating all this into a data mining model.

Optimized strategy for the highest potential

The result is an analytical model that indicates the optimal coverage of points of sale in relation to market potential and the type of consumer.

"Thanks to the project," says Della Serra, "we are able to identify the zones with the highest potential in Italy and to implement an optimized, balanced distribution strategy between the wholesale and retail channels. But there's more. On one hand, the segmentation of clients helps us to plan targeted marketing actions to be focused on members of the Thun Club, differentiated by territory in order to maximize returns. And on the other hand, monitoring the performance of points of sale enables us to both gain a realistic vision of the business and the results of our commercial policies and also to objectively define goals to be assigned to each individual micro-area."

This story originally appeared on ita.sas.com.

Challenge

Optimize the commercial strategy to best manage distribution, which revolves around the wholesale and retail channels.

Solution

Benefits

The results illustrated in this article are specific to the particular situations, business models, data input, and computing environments described herein. Each SAS customer’s experience is unique based on business and technical variables and all statements must be considered non-typical. Actual savings, results, and performance characteristics will vary depending on individual customer configurations and conditions. SAS does not guarantee or represent that every customer will achieve similar results. The only warranties for SAS products and services are those that are set forth in the express warranty statements in the written agreement for such products and services. Nothing herein should be construed as constituting an additional warranty. Customers have shared their successes with SAS as part of an agreed-upon contractual exchange or project success summarization following a successful implementation of SAS software. Brand and product names are trademarks of their respective companies.